Tribune Publishing profit declines 54%

Tribune Publishing's net income declined 54% in the fourth quarter, primarily because of lower advertising revenue and debt service associated with its spinoff, the company said Wednesday.

The owner of the Los Angeles Times posted earnings of $15 million, or 60 cents per share, in the quarter ended Dec. 28, its first as a stand-alone company.

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Revenue fell 5.5% to $457 million, with circulation and digital gains unable to offset advertising declines. Advertising revenue was $266 million, down $30 million or 10.4% from the same quarter in 2013.

The results beat analyst expectations for revenue, but fell short on earnings.

Chicago-based Tribune Publishing owns and operates 10 daily newspapers, including the Chicago Tribune and Los Angeles Times. It was spun off from Tribune Media in August.

For the full year, Tribune Publishing saw revenue decline 4.8% to $1.7 billion. Net income fell to $42 million, or $1.66 per share, a 55% decline.

Tribune Publishing launched its next generation online platform across the company during the fourth quarter, and saw digital revenue grow to about $200 million for the year, about 11% of total revenue.

The company said it had 3.2 million registered digital users, 659,000 paid digital users and 61,000 digital-only subscribers at the end of 2014, leaving plenty of potential upside ahead.

"With significant investments behind us, we expect to see growth in digital revenues in 2015," Jack Griffin, Tribune Publishing's CEO, said in a statement.

The company said it sees revenue declines slowing in 2015, declining an estimated 3% to about $1.66 billion. It plans to reduce expenses by $65 million to $70 million for the year, mostly through centralizing procurement, according to Sandy Martin, interim CFO of Tribune Publishing.

"There are going to be ... savings that we never took advantage of as a company tucked in under Tribune Co.," Martin said.

Layoffs aren't expected to be part of the cost-savings measures.

"It's not having to do with personnel changes," Martin said. "It's more having to do with the low-hanging fruit of central buying. We were buying as eight different markets ... and now we're buying as one company."